at SciVerse ScienceDirect

Journal of Environmental Management 127 (2013) 86e95

Contents lists available

Journal of Environmental Management

journal homepage: www.elsevier .com/locate/ jenvman

Performance and prospects of payments for ecosystem servicesprograms: Evidence from China

Wu Yang a,*, Wei Liu a, Andrés Viña a, Junyan Luo a, Guangming He a, Zhiyun Ouyang b,Hemin Zhang c, Jianguo Liu a,b

aCenter for Systems Integration and Sustainability, Michigan State University, East Lansing, MI 48823-5243, USAb State Key Laboratory of Regional and Urban Ecology, Research Center for Eco-Environmental Sciences, Chinese Academy of Sciences, Beijing 100085, ChinacChina’s Center for Giant Panda Research and Conservation, Wolong Nature Reserve, Wenchuan County, Sichuan Province 623006, China

a r t i c l e i n f o

Article history:Received 4 August 2012Received in revised form25 March 2013Accepted 6 April 2013Available online

Keywords:Community-based natural resourcesmanagementConservation effectivenessCoupled human and natural systemsIncentive-based mechanismsNatural Forest Conservation ProgramWolong Nature Reserve

* Corresponding author. Tel.: þ1 517 432 5068; faxE-mail address: yangwu1201@gmail.com (W. Yang

0301-4797/$ e see front matter � 2013 Elsevier Ltd.http://dx.doi.org/10.1016/j.jenvman.2013.04.019

a b s t r a c t

Systematic evaluation of the environmental and socioeconomic effects of Payments for Ecosystem Ser-vices (PES) programs is crucial for guiding policy design and implementation. We evaluated the per-formance of the Natural Forest Conservation Program (NFCP), a national PES program of China, in theWolong Nature Reserve for giant pandas. The environmental effects of the NFCP were evaluated througha historical trend (1965e2001) analysis of forest cover to estimate a counter-factual (i.e., without-PES)forest cover baseline for 2007. The socioeconomic effects of the NFCP were evaluated using datacollected through household interviews carried out before and after NFCP implementation in 2001. Ourresults suggest that the NFCP was not only significantly associated with increases in forest cover, but alsohad both positive (e.g., labor reduction for fuelwood collection) and negative (e.g., economic losses due tocrop raiding by wildlife) effects on local households. Results from this study emphasize the importance ofintegrating local conditions and understanding underlying mechanisms to enhance the performance ofPES programs. Our findings are useful for the design and implementation of successful conservationpolicies not only in our study area but also in similar places around the world.

� 2013 Elsevier Ltd. All rights reserved.

1. Introduction

Much of the unprecedented degradation of importantecosystem services due to human activities (MA, 2005) has beenexplained using the classic ‘tragedy of the commons’ framework(Hardin, 1968; Jack et al., 2008). However, the landmark work byOstrom (1990, 2009), Ostrom et al. (1999, 1994, 2007) challengedthis view and suggested that common pool resources can be suc-cessfully managed even without government intervention or pri-vatization. Nevertheless, in many cases government intervention isstill necessary, particularly when local management of commonpool resources does not exist or is ineffective (Jack et al., 2008).Among the different types of government intervention, paymentfor ecosystem services (PES) programs have recently emerged forrealigning economic and social costs/benefits among differentstakeholders through incentive-based mechanisms (Chen et al.,2012; Jack et al., 2008; Scherr et al., 2006). A formal definition of

: þ1 517 432 5066.).

All rights reserved.

PES was given by Wunder (2005) as “a voluntary and conditionaltransaction over well-defined ecosystem services between at leastone seller and one buyer”.

During thepast decade, hundredsof PES initiativeshaveemergedglobally (Kalacska et al., 2008; Liu et al., 2008; Sanchez-Azofeifaet al., 2007; Wunder and Alban, 2008). Among these, China intro-duced two of the largest PES programs in terms of scale, total pay-ments and duration (Liu et al., 2008; Task Force for Eco-Compensation Mechanisms and Polices in China, 2007). Because inmany areas participation in these programs is not completelyvoluntary (Yin, 2009), theymaynot be regardedas PESprogramsbutrather as PES-like programs. However, for consistency, in this articlewe refer to them as PES programs. One of them, the Grain-to-GreenProgram(GTGP, also knownas the Sloping LandConversionProgramor the Farm to Forest Program), was initiated in 1999 at the nationallevel to restore natural ecosystems and to mitigate negative off-siteeffects (e.g., drought, flood, dust storm, sedimentation of reservoirs)caused by agricultural expansion onto marginal and/or steep land(Liu and Diamond, 2005; Liu, 2010; Liu et al., 2013). By the end of2009, GTGPhadaccumulated an investmentof ca. 31.7 billionUSD (1USD¼ 6.3 Chinese yuan, May 2012), with averages of 547.6 USD per

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e95 87

ha and 381.0 USD per ha in the upper reaches of the Yangtze Riverbasin and middle-upper reaches of the Yellow River basin, respec-tively (Liu et al., 2013). By 2009, ca. 32 million rural householdsenrolled ca. 8.8 million ha of cropland in the GTGP (Liu et al., 2013).The Natural Forest Conservation Program (NFCP) aims to conservenatural forests via logging bans and afforestation incentives. By theend of 2009, the NFCP had accumulated an investment of ca. 14.9billion USD (Liu et al., 2013). To date both GTGP and NFCP have beenfunded entirely by the central and local governments. However, theGTGP is a direct PES program involving local households, while theNFCP is an indirect PES program that is operated by local forestrybureaus and seldom engages local households. Only in very fewareas such as in Wolong Nature Reserve for giant pandas, thedecentralization of NFCP implementation and engagement of localhouseholds have been attempted.

While several studies (Chen et al., 2009, 2010; Uchida et al.,2009, 2005; Viña et al., 2013; Xu et al., 2002, 2004) have evalu-ated the effectiveness and efficiency of the GTGP, relatively few (Xuet al., 2002; Yin, 2009) have studied the effectiveness and efficiencyof the NFCP. In addition, to our knowledge no study has evaluatedthe decentralized implementation of the NFCP (e.g., participation oflocal households) and its environmental and socioeconomic con-sequences. Moreover, very few previous studies on PES programsthroughout the world (Arriagada et al., 2009; Gross-Camp et al.,2012; Scullion et al., 2011) have addressed their environmentaland socioeconomic outcomes simultaneously.

Based on more than 30 years of remotely sensed data combinedwithmore than 10 years of household survey data, in this article weattempt to fill some of these knowledge gaps in the Wolong NatureReserve for Giant Pandas. Our objectives are: (1) to evaluate theenvironmental outcomes of PES program implementation using acounter-factual without-PES baseline, estimated using the histori-cal trend of forest cover change; (2) to capture short-term socio-economic effects based on empirical data before and after theimplementation of the PES program; and (3) to summarize effectivepractices and learned experiences, as well as challenges and op-portunities for guiding future conservation policy design andimplementation.

Fig. 1. Map of the Wolong Nature Reserve. (The readers are referred to

2. Materials and methods

2.1. Study area

We chose Wolong Nature Reserve for Giant Pandas (Ailuropodamelanoleuca) as our study area not only because it is one of theearliest nature reserves established in China, but also because it hasa relatively independent administrative ability to design andimplement its local PES programs. The reserve is characterized by ahigh biological diversity and supports approximately 10% of thetotal wild giant panda population (Zhang et al., 1997), making it aflagship reserve not only in China but also around the globe (Liuet al., 2003a).

The Wolong Nature Reserve (N 30�450e31�250, E 102�520e103�240, Fig. 1) is located in Wenchuan County, Sichuan Province,China, in the transition between the Sichuan Basin and the Qinghai-Tibet Plateau. The reserve is characterized by a high variation intopography (e.g., elevations ranging from 1200 to 6250m above sealevel), soils, climates and hydrological conditions (Viña et al., 2008).In 1963 (when it was first designated as a nature reserve), its sizewas around 20,000 ha, but was expanded in 1975 to its current sizeof approximately 200,000 ha (Wolong Nature Reserve, 2005).Natural vegetation in the reserve is dominated by four types offorest, all of which are associated with understory bamboo species:subtropical, evergreen broad-leaf forests (<1600m), evergreen anddeciduous broad-leaf forests (1600e2000 m), mixed coniferousand deciduous broad-leaf forests (2000e2600 m), and sub-alpineconiferous forests (2600e3600 m; Schaller et al., 1985; WolongNature Reserve, 2005).

In 1983, the State Council authorized the reserve to establish theWolong Special Administrative Region with the purpose of pro-tecting regional forest ecosystems and rare plant and animal spe-cies, but primarily for the conservation of the iconic giant panda(Wolong Nature Reserve, 2005). The establishment of the WolongSpecial Administrative Region allowed the reserve to be a relativelyindependent administrative entity. Currently, the reserve has twotownships (i.e., Wolong and Gengda), with a total human popula-tion of approximately 5700, including around 4900 local residents

the web version of the article for a version in color of this figure).

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e9588

that are distributed in approximately 1200 households. Most localresidents are farmers involved in socioeconomic activities such ascultivating maize and vegetables, raising livestock, collecting me-dicinal plants, keeping bees, collecting fuelwood, and cooking an-imal and human food (Yang et al., 2013a). Fuelwood in the reserve isprimarily used for heating, cooking pig fodder, cooking humanfood, and smoking pork. It is a local tradition to raise pigs, smokepork using fuelwood, and eat smoked pork.

The establishment of the reserve and its expansion in 1975 didnot mitigate the degradation of forest and panda habitat inside itsborders (Liu et al., 2001). Therefore, several PES programs havebeen designed and implemented. The first one was implemented in1986 with funds from the World Food Programme of the UnitedNations, through which 113 ha of cropland were converted intoforest (Wolong Nature Reserve, 2005). Since 2000, two national(i.e., GTGP and NFCP) and one local (Grain-to-Bamboo Program)PES programs have been implemented in the reserve. Table 1 de-scribes general information on these three PES programs. The threePES programs were designed to target almost all local ruralhouseholds but not all households enrolled in those programs(Table 1). As opposed to other NFCP implementation areas inwhichafforestation practices are also included, the implementation of theNFCP in the reserve only included forest monitoring activities,targeting all the areas (approximately 120,500 ha) below thetreeline (around 3600 m above sea level) in the reserve. As a localPES program complementing the GTGP, the Grain-to-BambooProgram was designed to increase the bamboo cover (giantpanda’s main food) by enrolling cropland located within a 15 mbuffer zone at each side of the main road (Fig. 1). The Grain-to-Bamboo Program has an annual payment rate of 2142.9e2857.1USD per ha, depending on the distance to the main road and thecropland production relinquished. With comparison to GTGP, thepayment rate of Grain-to-Bamboo Program is higher because ittargets flatter andmore productive cropland. To date, the GTGP andthe Grain-to-Bamboo Program have enrolled 367.3 and 81.9 ha ofcropland, respectively. But the total implemented area of GTGP andthe Grain-to-Bamboo Program comprises only 0.37% of the areaunder the NFCP, thus direct environmental effects of these pro-grams could be considered almost negligible. However, the GTGPand the Grain-to-Bamboo Program may induce both direct andindirect socioeconomic effects that should not be ignored (Chenet al., 2010). Therefore, we took the GTGP and Grain-to-BambooProgram into account when specifically examining the social andeconomic effects of conservation policies on local households.

Besides the implementation of PES programs, the major eco-nomic development in the reserve during the past two decades has

Table 1General information about the PES programs in Wolong Nature Reserve.

Item Natural Forest Conservation Program (NFCP) Grain-to

Beginning date 2001 2000Duration 10 years (renewed in 2010

for another 10 years till 2020)8 years

Legal mechanism National conservation policy National

Targeted area Forest parcels near householdlocations along the main road

Croplandwhich a

Targeted households 1130 rural householdsb All 1200Implemented area All land below treeline (i.e., 120,500 ha

and 3600 m above sea level), of which40,100 ha were assignedfor household monitoring

367.3 ha

Average payment ratea w143 USD per household per year w571 U

a Household interviews, 1 USD ¼ 6.3 Chinese yuan as of May 2012.b About 70 households were excluded because their household heads or their spouses h

households. Source: Wolong Administrative Bureau.

been tourism. A tourism development plan was proposed andadopted as a tool to generate funds for conservation and to providealternative income sources for local farmers. While it started in the1980s, this plan was not fully implemented until 2000 after thesuccessful breeding of captive pandas and the completion of aprovincial highway in the late 1990s (Liu et al., 2012). Thus, whileonly 4% of the households in the reserve participated in tourismactivities in 1998, this increased to 28% in 2007 (Liu et al., 2012).Tourism development has grown in tandem with infrastructuredevelopment (e.g., road, hotels, and hospitals) and with govern-ment revenue. However, more than 96% of the total tourism reve-nue has been retained by the local government and an outsidetourism company, limiting the benefits to local households (Heet al., 2008; Liu et al., 2012).

2.2. Forest cover dynamics

The dynamics of forest cover in the reserve were obtained fromforest cover maps developed in previous studies (Liu et al., 2001;Viña et al., 2007, 2011). These maps were developed using datafrom different satellite platforms (i.e., Corona, Landsat MSS andLandsat TM) combined with ground-truth data acquired duringfield work. These maps depict information on forest cover in thereserve during the years 1965, 1974, 1987, 1994, 1997, 2001 and2007. Image classification procedures ranged from visual inter-pretation (Liu et al., 2001) to unsupervised digital image classifi-cation (Viña et al., 2007, 2011) using the ISODATA technique, aniterative process for non-hierarchical pixel classification (Jensen,1996). Overall accuracies of these maps were between 78% and88% using independent ground-truth data (Liu et al., 2001; Viñaet al., 2007, 2011). These maps included two main land coverclasses (i.e., forest and non-forest). For a detailed description ofclassification procedures and assessments of map accuracy pleaserefer to the cited studies (Liu et al., 2001; Viña et al., 2007, 2011).

2.3. Focus group, individual and household interviews

To understand planning, implementation, evaluation and deci-sion making processes involved with the NFCP, we conducted focusgroup, individual, and household interviews. We invited eight staffmembers of the reserve for focus group interviews in 2002, 2007,2009 and 2010. These people were selected because they weredirectly participating in the implementation and evaluation pro-cesses of the NFCP. These focus group interviews were organized todiscuss forest monitoring activities before the NFCP, perceptiontoward NFCP benefits and costs, and problems and challenges

-Green Program (GTGP) Grain-to-Bamboo Program

2002(renewed in 2008 for another 8 years) 8 years (ended in 2010)

conservation policy Local conservation policycomplementing the GTGP

with slopes larger than 25� ,re around household locations

Cropland within the 15 m buffer zoneat each side of the main road

rural households All 1200 rural householdsfrom 969 households 81.9 ha from w530 households

SD per ha per year 2143e2857 USD per ha per year

ave non-rural household registration and thus they were not regarded as local rural

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e95 89

during the NFCP implementation. We also had individual discus-sions with five officials who were in charge of NFCP planning,implementation, evaluation and decision making in 2002, 2007,2009 and 2010. The information obtained from focus and individualinterviews were further verified from published and unpublishedgovernmental documents as well as through household interviews.

For household interviews, we usually chose the householdheads or their spouses as interviewees because they are the deci-sion makers and are familiar with household affairs (An et al.,2001). For the household interview before the NFCP, we useddata acquired in 1999 (220 households through stratified randomsampling, approximately 20% of the total households in thereserve) from previous studies (An et al., 2002, 2003) by ourresearch team. Data after the implementation of NFCP were ac-quired in 2002 (200 households), 2007 (192 households) and 2009(207 households). About 170 randomly sampled households werealways surveyed across the different years (i.e., panel data). Thepanel surveys elicited basic information such as demographic sta-tus, household socioeconomic activities (i.e., income and expendi-ture) and energy use (e.g., fuelwood and electricity). In the 2007and 2009 surveys, besides basic information from panel surveys,we also added questions regarding NFCP, GTGP and Grain-to-Bamboo Program payments, and perceptions toward NFCP imple-mentation. All monetary measures used in analyses were dis-counted into constant values in the year 2007.

2.4. Local adaptation and implementation of the NFCP

Like in Costa Rica (Sanchez-Azofeifa et al., 2007), a national PESimplementation authority exists for the NFCP in China. The annualbudget for NFCP implementation in the reserve was 389,206 USD,of which 380,000 USD and 9206 USD were from the central andprovincial governments, respectively. With assistance from theForest Inventory and Planning Institute of Sichuan Province (Fig. 2),the Wolong Administrative Bureau designed and implemented alocal NFCP. On the one hand, the administrative bureau intended toreduce conflicts with local households on forest use and engagethem in forest monitoring activities through economic incentives(i.e., payments). On the other hand, the administrative bureauhoped that the NFCP payment would compensate the foregonehousehold income sources, reduce illegal logging and fuelwoodcollection, and even increase household income by encouraging

Fig. 2. Natural Forest Conservation Program (NFCP) implementation in the WolongNature Reserve (WNR).

households to switch from on-farm to off-farm economic activities.The NFCP payment rate for each household was fixed across yearsand was decided based on available funding from central andprovincial governments, excluding administrative and operationalcosts (e.g., costs for government patrolling and biannual NFCPevaluations). The administrative bureau also hoped that the switchfrom fuelwood to electricity would reduce the pressure on forests.Before the implementation of NFCP, there were eight small hy-dropower stations in the reserve with a total capacity of 34 MW(Wolong Nature Reserve, 2005). But the electricity generated fromthese hydropower stations was mostly exported outside thereserve. To assist the implementation of NFCP and promote theswitch from fuelwood to electricity, local power grids wereupgraded and a so-called ecological hydropower station with atotal capacity of 1600 kW was constructed in 2002. This ecologicalhydropower station compensated the electricity price for localhouseholds by 0.01 USD per kW-h, leading to an actual unit resi-dential electricity price of 0.03 USD per kW-h (Wolong NatureReserve, 2005). Finally, an integrated local program of NFCP wasimplemented, which included the logging ban, payments forhousehold participatory forest monitoring activities, upgrading ofrural power grids, compensation for electricity price, and theestablishment of forestry police force to enhance policyenforcement.

Approximately 40,100-ha forest (about one third of the totalimplementation area in the reserve) was assigned to around 1130households, with an annual average payment rate of approximately143 USD per household (Table 1), while the remaining area wasmonitored by the staff of the Wolong Administrative Bureau.Initially, the Wolong Administrative Bureau attempted to assign asingle forest parcel to each household. However, this approachturned out to be very difficult to implement because of the diffi-culty in clarifying forest parcel boundaries. Therefore, the Bureaufinally decided to assign large forest parcels, defined using naturalboundaries (e.g., rivers, ridges, valleys), to groups ranging in sizefrom 1 to 16 households (Yang et al., 2013c). Of the 40,100 ha offorest assigned to household monitoring activities, around16,700 ha were assigned to individual households while theremaining areas were assigned to groups with two or morehouseholds. Through this approach, a household-groupmonitoringapproach was created which binds households together for forestmonitoring activities. Each household in a group shared the samemonitoring responsibility and received the same amount of pay-ment as other household members. The Bureau evaluates the per-formance of household forest monitoring activities throughbiannual field assessments of illegal activities (e.g., logging, hunt-ing, mining, grazing in restricted areas, collection of seeds andbamboo shoots, and other activities considered to negatively affectsoils, wildlife and natural vegetation) using a score-based quanti-tative evaluation standard for deducting payments. All local resi-dents are encouraged to report illegal activities and will berewarded in cash by the Bureau. If any illegal activity is detected in aforest parcel, all households in its corresponding group will havethe same amount of payment deduction, unless they identify theculprits of the illegal activity to the Bureau (Yang et al., 2013c).

2.5. Baseline for environmental benefits

A fundamental question of any PES program is its ability toaddress “additionality” (i.e., difference in ecosystem services pro-vision between the with-PES scenario and a without-PES baseline).In other words, is the additionality sufficiently large to warrantimplementation of a particular PES program (Wunder, 2007)? Toanswer this question it is necessary to first identify a counter-factual without-PES baseline scenario. Such counter-factual

Fig. 3. Forest cover area before and after the Natural Forest Conservation Program(NFCP) implementation in 2001. The historical forest cover trend from 1965 to 2001was used to estimate the counter-factual without-PES baseline in 2007. Additionality isthe difference between the with-PES outcome and the without-PES baseline.

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e9590

scenario may take any of three forms: static, deteriorating, orimproving (Wunder, 2007), which are difficult to identify if the PESprogram is already operational. However, it can be approximatedusing historical trends involving time periods before PES programimplementation, analyzing changes in similar without-PES studyareas (e.g., adjacent sites) or analyzing changes in larger regions oradministrative entities such as using entire countries as a baselinefor local PES program implementations (Kalacska et al., 2008). Inthis study we chose to analyze the historical trend of forest coversfrom 1965 to 2001 in the reserve to estimate the without-PESbaseline in 2007. This is a common approach used by the REDDand REDDþ (Reducing Emissions from Deforestation and forestDegradation, conservation, sustainable forest management andenhancement of forest carbon stocks) program (FONAFIFO et al.,2012; Olander et al., 2008). We chose this approach for two mainreasons. First, because NFCP is a national conservation policy, it wasimpossible to select appropriate without-PES baseline from similarstudy sites or use larger regional or administrative entities (e.g.,entire China). Second, before the local implementation of NFCP in2001, forest dynamics in the reserve showed a deteriorating trendfrom 1965 to 2001 (Liu et al., 2001; Viña et al., 2007) while Chinaoverall had been experiencing forest gains since the middle of1980s (State Forestry Administration of China, 2005). In addition,we acknowledge that the rapid socioeconomic development sincethe 1990s would also contribute to reduce the pressure on forests.But it should be noted also that external impacts (e.g., socioeco-nomic development) on the reserve had existed since 1961,particularly with the construction of unpaved roads and hadbecome more intensive since 1992 with the construction of pavedroads (Wolong Nature Reserve, 2005). Thus, the historical trend inforest cover already included part of these macro-socioeconomicimpacts.

Other synchronous factors such as the GTGP implementationand tourism development may have interaction effects with NFCPon forest cover change. However, the GTGP only accounts for avery small percentage (<1%) of the total land area of the reserve(Wolong Nature Reserve, 2005) and few local households havedirectly participated in, and benefited from, tourism related ac-tivities (He et al., 2008; Liu et al., 2012). Therefore, these factorswere not likely to be a major driving force of land cover change inthe reserve. Moreover, the main activities responsible for defor-estation in the reserve (i.e., logging and fuelwood collection) havebeen reduced due to the implementation of NFCP (see Section 3.2below). Our previous studies (Tuanmu, 2012; Viña et al., 2011;Yang et al., 2013c) also suggest that the NFCP has been a majordriving force of forest change in the reserve and surroundingareas since 2001. Viña et al. (2011) indicated that NFCP togetherwith GTGP led to the forest transition in Wenchuan County, froma net forest loss in 1990s to a net forest increase from 2001 to2007. Tuanmu (2012) suggested that controlling for other con-founding factors different NFCP monitoring approaches andpayment rates in different areas caused different change rates ofpanda habitat (of which forest is an essential component) acrossspace. Yang et al. (2013c) showed that different NFCP monitoringefforts of household groups led to varied changes in forest cover.Therefore, using the historical forest trend from 1965 to 2001 toestimate the forest area in 2007 as a without-PES baseline con-stitutes a reasonable approximation for evaluating the addition-ality of the NFCP implementation. However, as the reserveadopted the integrated NFCP implementation approach, the NFCPadditionality evaluated should be attributed not only to the NFCPbut also to other auxiliary measures (i.e., logging ban, upgradingof rural power grids, compensation for electricity price, and theestablishment of forestry police force to enhance policyenforcement).

3. Results

3.1. Environmental effects of the NFCP implementation in WolongNature Reserve

Implementation of the NFCP seems to have reduced illegallogging and increased forest cover in the reserve (Figs. 3 and 4a). Allstakeholders in the focus group, individual and household in-terviews shared the opinion that illegal logging activities werereduced largely in response to the NFCP.

The equation of historical forest trend from 1965 to 2001 forlinear extrapolation of without-PES baseline in 2007 is given as

Y ¼ �857:74X þ 1:79E � 6 R2 ¼ 0:94 (1)

where Y is the area of forest cover (ha), and X is year.An increase in forest cover is evident post-NFCP implementa-

tion. The with-PES forest cover in 2007 was significantly higherthan the estimated without-PES forest cover in 2001 (p < 0.05,Fig. 3). Before NFCP implementation, total forest cover decreasedfrom approximately 106,000 ha in 1965 to around 70,000 ha in2001, while it recovered to approximately 79,000 ha in 2007. Basedon forest cover dynamics between 1965 and 2001, the estimatedwithout-PES baseline for 2007 was approximately 68,000 ha.Therefore, the additionality of the PES program between 2001 and2007 might be estimated as around 11,000 ha, which accounts forroughly 5.5% of the total land area in the reserve.

Due to the differences in accuracy of land cover maps and othersynchronous interaction effects (e.g., effects of GTGP, tourismdevelopment), the approximately 11,000 ha gain in forest covercannot be completely attributed to the NFCP. However, it consti-tutes a reasonable estimation of the additionality, particularlybecause of the lack of other major drivers of land cover change andof the observed transition from forest loss before NFCP to forestgain after NFCP implementation (See Section 2.5). From 2001 to2007, the cumulative financial NFCP investment in the reserve bythe central and provincial governments was 2.8 million USD(Wolong Nature Reserve, 2005). Considering only this direct in-vestment and excluding indirect investments (e.g., tourism devel-opment, donations to conservation), the cost-effectiveness ratiomight be estimated as around 254.5 USD per ha of forest gained.

3.2. Socioeconomic effects of NFCP implementation in WolongNature Reserve

The implementation of the NFCP may be triggering not onlyenvironmental but also socioeconomic effects. While many effects

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%Provide payment

Reduce labor for

fuelwood collection

Improve environmental

quality

Prevent water and soil

erosion, landslides

Reduce hunting

Increase tourism

No benefits

Others

a

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Low payment

Difficult to collect

fuelwood

Unfair subsidy

distribution

Increase wildlife

disturbance

Restrict forest use

No disadvantages

b

0%

10%

20%

30%

40%

50%

60%

Largely increased

Slightly increased

No change

Silightly decreased

Largely decreased

Do not know

c

0%

10%

20%

30%

40%

50%

60%

70%

80%

Very satisfied

Mildly satisfied

Neither satisfied nor

unsatisfied

Mildly unsatisfied

Very unsatisfied

Do not know

d

Fig. 4. Perceptions of local households toward the Natural Forest Conservation Program (NFCP). aed represent households’ perceptions toward NFCP benefits (multiple responsequestion), NFCP disadvantages (multiple response question), wildlife-induced losses before and after NFCP implementation (single response question), and administration ofwildlife-induced losses (single response question), respectively. The total number of observations for each figure panel was 183.

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e95 91

may not be measurable in the short term, some short-term effectsare conspicuous and could be associated with the NFCP imple-mentation. For instance, a shift in the use of different energysources (i.e., from fuelwood to electricity) was conspicuous shortlyafter NFCP implementation. The amount of electricity consumptionper household doubled, while the amount of labor force spent incollecting fuelwood almost halved after NFCP implementation(Table 2). In addition, the energy source for cooking and heatingshifted significantly from high reliance on fuelwood to electricity,while the number of months using fuelwood for cooking pig fodderalso decreased. Given that the energy use shift from fuelwood toelectricity occurred shortly after NFCP implementation but before

Table 2Paired t-test for indicators of energy use before and after the NFCP implementation.

Pre-NFCP(Mean � S.D.)

Post-NFCP(Mean � S.D.)

Paired t-test(two-tailed)

Electricity consumptionamount (kW-h, N ¼ 169)

1165 � 1301 2562 � 1906 �9.57***

The amount of labor forcefor fuelwood collectionper year (laborer days,N ¼ 151)

64 � 30 33 � 29 10.02***

Duration of cooking pigfodder with fuelwood(months, N ¼ 149)

11.8 � 1.4 10.2 � 3.4 6.09***

Energy source for heating(N ¼ 148)

4.9 � 0.4 3.7 � 1.6 8.70***

Energy source for cookinghuman food (N ¼ 149)

4.5 � 0.9 2.3 � 1.4 19.10***

Notes: *p < 0.05, **p < 0.01, ***p < 0.001.Pre-NFCP and post-NFCP refer to the year 1998 (i.e., reference year before NFCP) and2001 (i.e., the first year after NFCP implementation), respectively.Energy source was classified into a 5-score scale on percentage of fuelwood use,with 1 for no use of fuelwood, 2 for 25% of fuelwood, 3 for 50% of fuelwood, 4 for 75%of fuelwood, and 5 of 100% use of fuelwood, respectively.

the upgrading of rural power grids and the completion of theecological hydropower station, this shift was most likely caused byother measures (i.e., the logging ban and payments for forestmonitoring) in the integrated NFCP implementation approach.Finally, no significant relation between household income and la-bor force spent in fuelwood collection was found (Pearson’sr ¼ 0.783, p > 0.1). Combined, these results suggest a generalpattern of switching from fuelwood to electricity irrespective ofhousehold economic status.

On average, total household income doubled from 1998 to2001 and quadrupled from 1998 to 2007. Most (i.e., 89%, N ¼ 183)interviewed households reported that the NFCP had brought morebenefits than costs to them. Overall household perception is thatthe implementation of NFCP provided payment, improved envi-ronmental quality, prevented water and soil erosion, landslides,and promoted tourism development (Fig. 4a). However, negativeeffects brought by the NFCP implementation were also reported.The most reported issue was the restriction on forest use (Fig. 4b).Interviewees claimed that their ancestors lived in the region forhundreds of years before the establishment of the reserve. Forseveral generations they have depended on forest resources (e.g.,timber, wildlife for hunting, fuelwood, traditional Chinese me-dicinal herbs, mushrooms, bamboo shoots, and other non-timberforest products). The NFCP implementation has inhibited many ofthese activities, and thus cultural traditions and customs (e.g.,using fuelwood to cook pig fodder, smoking pork with fuelwood,and eating smoked pork) have been affected. Other complaintsinclude the difficulty to collect fuelwood, as 80% of the 183 in-terviewees reported that they had to search a larger area to collectfuelwood due to the logging ban established by the NFCP (Fig. 4b).Almost all households incurred wildlife-induced losses withdifferent damage rates, although not all of them attributed suchlosses to the NFCP implementation. Approximately 65% of the 183interviewees claimed that wildlife-induced losses (e.g., loss ofcrops and livestock due to wildlife predators such as wild boars,

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e9592

hog badgers, bears, and monkeys) have significantly increasedafter the NFCP implementation (Fig. 4c). Approximately 89% of the183 interviewees were unsatisfied or very unsatisfied with gov-ernment inaction (i.e., no measures to reduce wildlife-inducedlosses or no compensation for wildlife-induced losses) (Fig. 4d).

4. Discussion

Before the NFCP implementation, the reserve suffered ecologicaldegradation in the form of deforestation and giant panda habitatlosses (Liu et al., 2001). Unlike many other areas in China, theimplementation of NFCP in the reserve engaged various stake-holders and developed a local program that integrates a loggingban with payments for monitoring activities and included multipleauxiliary measures (i.e., upgrading of rural power grids, compen-sation for electricity price, and the establishment of forestry policeforce to enhance policy enforcement). Environmental and socio-economic outcomes of the NFCP implementation were mixed,having both positive and negative outcomes.

While an increase in forest cover was observed in associationwith the implementation of the NFCP, it should be mentioned thatlittle information is currently available for the entire reserve on thespecies composition of these areas of forest gain. Field observationshave shown that some of these areas seem to be dominated byexotic and potentially invasive fast-growing species (e.g., Japaneselarch, Larix kaempferi). However, previous studies have shown thatgiant pandas and other native wildlife species including the Asiaticblack bear (Ursus thibetanus) used some of these areas (Bearer et al.,2008), suggesting that secondary forests may also provide habitatfor wildlife species and thus facilitate biodiversity conservation. Inaddition, the overall giant panda habitat suitability has increased,particularly in NFCP implementation areas (Tuanmu, 2012), sug-gesting that some of the forest areas restored have in fact becomesuitable habitat for the pandas. Therefore, while the environmentalbenefits obtained from the increase in forest cover associated withthe NFCP seem to be spatially heterogeneous, overall they seem tobe positive, at least in terms of habitat restoration for some wildlifespecies.

The effects of different conservation and development policieson changes in total household income were also mixed. Resultsfrom econometric models developed by our research group (Yanget al., submitted for publication) suggest that GTGP and Grain-to-Bamboo Program payments, initial electricity subsidy, andtourism participation had positive effects on changes in totalhousehold income from 1998 to 2007, respectively. With all othervariables controlled at their average values, a 1% increase of totalGTGP and Grain-to-Bamboo Program payments, or a 1% increase ofinitial electricity subsidy would on average increase the totalhousehold income by 2% and 0.04%, respectively. Ceteris paribus,households participating in tourism activities on average had a 54%higher increase of total household income than those that did notparticipate. However, only less than 28% of the households partic-ipated either directly or indirectly in tourism activities. Meanwhile,NFCP payment did not have a significant effect on changes in totalhousehold income from 1998 to 2007 (p > 0.1), while the interac-tion term between NFCP payment and tourism participation had anegative effect (p < 0.05). The drastic increase in total householdincome from 1998 to 2007 was largely due to selling agriculturalproducts (e.g., cabbages) outside the reserve, conducting local ormigrant labor, and participating in tourism (Liu et al., 2012; Yanget al., 2013a).

Below we summarize some of the lessons learned through theNFCP implementation in the reserve, as well as some challengesand opportunities.

4.1. Lessons learned through NFCP implementation in WolongNature Reserve

Several reasons were given by the interviewed households forthe significant reduction in forest cover losses (multiple responsequestion), amongwhich decentralization of monitoring activities tohouseholds (44% of 174 respondents) and payment for forestmonitoring activities (40% of 174 respondents) were ranked as thetwo most important. Other reasons, such as the upgrading of ruralpower grids and subsidies on electricity, were also highlighted asimportant in reducing forest cover losses. The introduction of theforest police team for enhancing NFCP enforcement was alsoregarded as an important contributor to the reduction in forestcover losses. Such vigorous local enforcement has also been showneffective in other PES programs in Ecuador (Wunder and Alban,2008) and in several other places around the world (Chhatre andAgrawal, 2008). Vigorous local enforcement efforts together withdecentralization of monitoring activities stimulate greater partici-pation and cooperation of service providers by curtailing expectedreturns from alternative illegal forest uses, hence renderingparticipation in PES programs more attractive (Chhatre andAgrawal, 2008).

The decentralization of forest monitoring to households com-plemented previous command-and-control measures. This decen-tralization encouraged the participation in, and compliance with,forest conservation policies. A previous study by our research grouphas found that panda habitat (for which forest cover is essential),recovered faster in household monitored parcels than in govern-ment monitored parcels, after controlling for other contextualfactors (e.g., elevation, slope, aspect, distance to the main road)(Tuanmu, 2012). We have also found that the effects of group size(i.e., the number of households for monitoring a forest parcel) onhousehold monitoring efforts and forest outcomes are nonlinear,with intermediate group size (i.e., 9 in a range from 1 to 16households) performing the best (Yang et al., 2013c). The optimumgroup size also shifts with context. These results confirm the pointof no ‘panacea’ or no ‘one-size-fit-all’ approach for successfulmanagement of common pool resources (Ostrom, 1990, 2009;Ostrom et al., 1999, 1994, 2007), and explain why the practice ofhousehold-group monitoring in the reserve turned out to be quiteeffective. On the one hand, with smaller group sizes, householdstend to free ride (i.e., do not participate in forest monitoring ac-tivities), particularly if there are inadequate punishment measureswithin the group. On the other hand, as group size increases, ahousehold would face increasing pressure of deteriorating socialrelationships with other households in the group, and thus wouldbe less likely to free ride (Yang et al., 2013c). Our previous study(Yang et al., 2013c) confirmed these two opposing effects of groupsize and the balance between them led to the observed nonlinearresponse. However, such mechanisms were not considered by thecorresponding policy makers during the initial NFCP design pro-cess. The decentralization and group size formation, althoughsuccessful, were more random than planned. Therefore, for guidingfuture policy design and implementation it is essential to firstconsider the mechanisms underlying the potential success or fail-ure of particular policy prescriptions.

The synchronous reduction of fuelwood consumption, increaseof electricity consumption, and decrease of labor force for fuelwoodcollection activities shortly after the NFCP implementation andbefore the upgrading of rural power grids and the completion of theecological hydropower station suggest that the logging ban andpayments for forest monitoring were the most likely candidates inreducing the pressure on forests. Later, upgrading rural power gridsand the ecological hydropower station may have also contributedto the reduction of logging and forest recovery. Such an upgrade

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e95 93

combined with subsidies for electricity use provided an alternativeenergy source that simplified the switch from fuelwood to elec-tricity. This suggests that auxiliary measures offering alternativelivelihoods are essential for the successful implementation of PESprograms. Rather than relying on command-and-control measures,service buyers should then guide and facilitate service providers tochange environmentally harmful behaviors with alternativesolutions.

The integration of quantitative evaluation standards with thePES incentive and punishment mechanism served as a rigorous andsinewy gate guard for policy enforcement. The essential differencebetween this evaluation approach and previous approaches wasthe emphasis on performance-based measures complementingwith command-and-control measures. This specifically involvedthe design and execution of an evaluation criterion aimed atassessing the outcomes of the NFCP implementation rather thanthe processes or procedures for household forest monitoring.Meanwhile, all the outcomes were linked with the incentive andpunishment mechanisms (i.e., PES distribution and relevant lawenforcement). Without this integrated evaluation approach, themotivation for regular voluntary forest monitoring by householdsmay largely diminish, as penalties would not be effectivelyexecuted. Without this performance-based evaluation measuresthe PES program may have been ineffective.

4.2. Challenges and opportunities

The overall environmental and socioeconomic performances ofthe NFCP in the reserve were mixed and there were still someunresolved questions. For instance, could the PES program be moreeffective or efficient? Was it ethical to achieve conservation goalswith the socioeconomic costs on local communities? Herewe arguethat the PES program could be conducted in a more effective, effi-cient, ethical and sustainable manner.

First, fundamental questions on PES are, to whom, and howmuch should be paid? From an efficiency perspective, only thosewho constitute a credible threat to ecosystem services provisionshould be in the scope of a PES program (Wunder, 2005). But if thisis the case, this perspective may be unfair to those who do notthreaten ecosystem service provision. However, those who do notthreaten the provision of ecosystem services usually do not haveopportunity costs from foregone environmentally harmful activ-ities (e.g., logging) and may even obtain benefits due to the exter-nality of ecosystem service provision. As pointed out by Wunder(2005), “the ideal ecosystem service seller is, if not outright envi-ronmental nasty, then at least potentially about to become so”. Thecurrent NFCP payment rate in the reserve was designed in the year2001 as a flat payment, which is becoming less attractive because ofinflation and increasing opportunity costs. Thus, ideally those whodo not or potentially will not be involved in any threateningdeforestation activities should not be included in the NFCP. Evenwith a fixed budget, savings from the reduction of participants maybe used to appropriately increase payment rates, to make themmore attractive and competitive. However, it is necessary to firstdevelop strategies for targeting an optimal pool of participanthouseholds, while keeping the selection of participants voluntary,objective, and transparent. Theoretically, such targeting strategiesand payment levels should be jointly designed to maximize envi-ronmental benefits with a given budget (Alix-Garcia et al., 2008;Wunscher et al., 2008). Lessons and experience on designing tar-geting strategies (e.g., inverse auction systems) and payment pro-grams (e.g., discriminative payment levels) may be learned fromstudies not only in this region (Chen et al., 2010; Viña et al., 2013)but also from other regions (Alix-Garcia et al., 2008; Uchida et al.,2005; Wunscher et al., 2008).

Second, diversified funding would be critical for sustainablemanagement of the PES program. Theoretically, there are five basictypes of service buyers,who respond to differentmotivations (Scherret al., 2006), including: (1) philanthropic buyers motivated by non-use values; (2) public sector buyers (e.g., governmental administra-tions at different scales); (3) private businesses, organizations orcommunities who engage in private deals to secure use values orother business benefits; (4) private buyers who are under regulatoryobligation tooffsetenvironmental impacts, and (5) consumersof eco-certified products and services. The current NFCP implementation isdominated by the form of public sector buyers (i.e., governmentcompensation mechanism), which currently exhibit the greatest ex-pectations for many sectors in China (Task Force for Eco-Compensation Mechanisms and Polices in China, 2007). However,as it iswidelyaccepted, government compensationmechanismshavelimitations that are difficult to overcome, including the lack of elas-ticity, difficulty in defining payment rates, high operational costs, andexcessive governmental fiscal pressure, among others (Liu et al.,2008; Task Force for Eco-Compensation Mechanisms and Polices inChina, 2007). Currently, except through PES programs, many non-market ecosystem services (e.g., water purification, carbon seques-tration) are being consumed but are not being paid for (Jack et al.,2008; Yang et al., 2008). Thus, to secure financial sustainability ofcurrent and future PES programs, both public and private fundsshould be engaged. In the reserve, for example, hydropower com-panies in the basin provide a small compensation amount for theelectricity they produce but they should provide more funds sincethey directly benefit from the service ofwater conservationprovidedthrough the conservation of forests. Tourism companies should alsopay for the direct benefits they receive through ecotourism and rec-reation activities in the reserve.

Third, there is a continuous challenge to improve the humanwell-being of local households (Yang et al., 2013b) with minimalinterference to their local traditions and customs. The economicconditions of local households are still at a low level and many arestill struggling to maintain basic livelihoods. Therefore, on the onehand, local households should be guided to find alternative incomesources and increase their total income. Currently, agricultural in-come is the major economic source for most of the local householdsand is vulnerable to natural disasters (e.g., rainstorms, mountaintorrents, landslides). The relatively small amount of subsidiesreceived from various PES programs is not, neither now nor in theforeseeable future, themain income source for local households. Butsince the reserve is famous worldwide as the home to the endan-gered giant panda, it provides great opportunities to engage aca-demic institutions, non-governmental organizations and industrialenterprises at different scales to meet local needs. For instance,current ecotourism and recreation activities in the reserve arelargely directed by tourism development companies while localcommunities obtain few or no benefits (He et al., 2008; Liu et al.,2012). The spontaneously emerged “Happy Farmer’s House”tourism and other potential solutions that are adaptive to localconditions (e.g., cultivation of traditional Chinese Medicine, eco-certified products, and multiple uses of forests, especially non-timber forest products) and that bring direct benefits to localhouseholds could alsobe important alternative solutions to consider(Liu et al., 2012). On the other hand, it is important to improve thequality of local elementary and high-school education (Liu et al.,1999a, 1999b, 2003b), the quality of local medical care, and socialrelations among households and between households and the localgovernment (Yang et al., 2013b), all of which are essential compo-nents of humanwell-being (MA, 2005).

Finally, both short- and long-term socioeconomic effects relatedto the PES program and interaction effects among various policies(Liu et al., 2008) should be addressed. Whereas some studies in

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e9594

other areas (Daniels et al., 2010; Uchida et al., 2009) have discussedenvironmental and socioeconomic effects of PES programs, they aremostly scattered, fragmented, short term and opportunistic (Liuet al., 2008). In the reserve, although this study captured someshort-term effects, many consequences are neither well-understoodnor seriously tackled during the decision making processes. Forinstance, wildlife-induced losses (e.g., crop raids) are becoming aprevalent phenomenon throughout many protected areas in Chinadue to the recovery of wildlife habitat and increase of wildlifepopulation after the implementation of conservation policies (Caiet al., 2008; Liu et al., 2013; Zhang and Wang, 2003). However, todate, there are no policies or regulations to address such humanewildlife conflicts, since conservation needs mostly overwhelm per-sonal and property rights in protected areas. It should be thenemphasized that taking the socioeconomic effects related to the PESprogram into consideration is not only an ethical issue but also it iscritical for the sustainability of current and future PES programs.

5. Conclusions

At the local scale, the PES program seems to have beenresponsible for most of the observed increase in forest cover in thereserve. Nevertheless, it had also induced some socioeconomic ef-fects to local households such as impacts on local livelihoods,increasing wildlife-induced losses, and threats to local culture,traditions and customs. Many other short- and long-term effects aswell as interaction effects with other conservation and develop-ment policies are largely unknown at this moment.

Lessons learned from this case study emphasize the importanceof integrating local conditions as well as the need for understand-ing underlying mechanisms into the design and implementation ofPES programs for their successful and sustainable performance. Inthe reserve, the successful performance of the NFCP included acombination of decentralization of forest monitoring activities tohouseholds, enforcement efforts, integration of PES with otherauxiliary measures, and the emphasis on performance-basedmeasures complementing command-and-control measures. Keyissues regarding the effectiveness, efficiency, ethics, and sustain-ability of current and future PES programs include adaptation of thepolicy cycle, identification, selection and engagement of potentialbeneficiaries and benefactors, appropriate and effective incentiveand punishment mechanisms, diversity and security of financialsources, alternative income sources for local residents, and solu-tions for short- and long-term negative socioeconomic effects.

Conservation policy planning and implementation are complexprocesses. Future interdisciplinary studies are needed to disen-tangle underlying complexities such as heterogeneity across space,time and PES targeting agents, complex interactions of drivingforces, contextual effects, reciprocal effects and feedback loopsbetween human and natural systems. As a global conservationhotspot, the Wolong Nature Reserve for giant pandas acts as aflagship both for China’s and global conservation practice. Lessonslearned in theWolong Nature Reserve may also guide policy designand implementation in many other places across China and aroundthe world.

Acknowledgments

We thank the Wolong Administrative Bureau for logistic helpand particularly recognize the assistance from Jian Yang, XiaogangShi, Haibin Xu, Hao Tang, Mingchong Liu and Lun Wang. Wegratefully acknowledge the financial support from the United StatesNational Science Foundation (NSF: Dynamics of Coupled Naturaland Human Systems program and Partnership for InternationalResearch and Education), the National Aeronautics and Space

Administration (NASA: Land Use/Land Cover Change program), andMichigan State University’s Environmental Science and PolicyProgram, and Graduate Office.

References

Alix-Garcia, J., De Janvry, A., Sadoulet, E., 2008. The role of deforestation risk andcalibrated compensation in designing payments for environmental services.Environ. Dev. Econ. 13, 375e394.

An, L., Liu, J., Ouyang, Z., Linderman, M., Zhou, S., Zhang, H., 2001. Simulating de-mographic and socioeconomic processes on household level and implicationsfor giant panda habitats. Ecol. Model. 140, 31e49.

An, L., Lupi, F., Liu, J., Linderman, M.A., Huang, J., 2002. Modeling the choice toswitch from fuelwood to electricity: implications for giant panda habitat con-servation. Ecol. Econ. 42, 445e457.

An, L., Mertig, A.G., Liu, J., 2003. Adolescents leaving parental home: psychosocialcorrelates and implications for conservation. Popul. Environ. 24, 415e444.

Arriagada, R.A., Sills, E.O., Pattanayak, S.K., Ferraro, P.J., 2009. Combining qualitativeand quantitative methods to evaluate participation in Costa Rica’s Program ofpayments for environmental services. J. Sustain. Forest. 28, 343e367.

Bearer, S., Linderman, M., Huang, J.Y., An, L., He, G.M., Liu, J.Q., 2008. Effects offuelwood collection and timber harvesting on giant panda habitat use. Biol.Conserv. 141, 385e393.

Cai, J., Jiang, Z.G., Zeng, Y., Li, C.W., Bravery, B.D., 2008. Factors affecting crop damageby wild boar and methods of mitigation in a giant panda reserve. Eur. J. Wildl.Res. 54, 723e728.

Chen, X., Lupi, F., He, G., Ouyang, Z., Liu, J., 2009. Factors affecting land reconversionplans following a payment for ecosystem service program. Biol. Conserv. 142,1740e1747.

Chen, X., Lupi, F., Vina, A., He, G., Liu, J., 2010. Using cost-effective targeting toenhance the efficiency of conservation investments in payments for ecosystemservices. Conserv. Biol. 24, 1469e1478.

Chen, X., Lupi, F., An, L., Sheely, R., Viña, A., Liu, J., 2012. Agent-based modeling of theeffects of social norms on enrollment in payments for ecosystem services. Ecol.Model. 229, 16e24.

Chhatre, A., Agrawal, A., 2008. Forest commons and local enforcement. Proc. Natl.Acad. Sci. U.S.A. 105, 13286e13291.

Daniels, A.E., Bagstad, K., Esposito, V., Moulaert, A., Rodriguez, C.M., 2010. Under-standing the impacts of Costa Rica’s PES: are we asking the right questions?Ecol. Econ. 69, 2116e2126.

FONAFIFO, CONAFOR, Ministry of Environment, 2012. Lessons Learned for REDDþfrom PES and Conservation Incentive Programs. Examples from Costa Rica,Mexico, and Ecuador. World Bank, Forest Trends and PROFOR, Costa Rica,Ecuador, Mexico. p. 164.

Gross-Camp, N.D., Martin, A., McGuire, S., Kebede, B., Munyarukaza, J., 2012. Pay-ments for ecosystem services in an African protected area: exploring issues oflegitimacy, fairness, equity and effectiveness. Oryx 46, 24e33.

Hardin, G., 1968. The tragedy of the commons. Science 162, 1243e1248.He,G., Chen, X., Liu,W., Bearer, S., Zhou, S., Cheng, L., Zhang,H., Ouyang, Z., Liu, J., 2008.

Distribution of economic benefits from ecotourism: a case study of Wolong Na-ture Reserve for Giant Pandas in China. Environ. Manage. 42, 1017e1025.

Jack, B.K., Kousky, C., Sims, K.R.E., 2008. Designing payments for ecosystem services:lessons from previous experience with incentive-based mechanisms. Proc. Natl.Acad. Sci. U.S.A. 105, 9465e9470.

Jensen, J.R., 1996. Introductory Digital Image Processing, a Remote SensingPerspective, second ed. Prentice Hall, New Jersey.

Kalacska, M., Sanchez-Azofeifa, G.A., Rivard, B., Calvo-Alvarado, J.C., Quesada, M.,2008. Baseline assessment for environmental services payments from satelliteimagery: a case study from Costa Rica and Mexico. J. Environ. Manage. 88,348e359.

Liu, J., 2010. China’s road to sustainability. Science 328, 974.Liu, J., Diamond, J., 2005. China’s environment in a globalizing world. Nature 435,

1179e1186.Liu, J., Ouyang, Z., Tan, Y., Yang, J., Zhou, S., 1999a. Changes in human population

structure and implications for biodiversity conservation. Population and Envi-ronment 21, 45e58.

Liu, J., Ouyang, Z., Taylor, W.W., Groop, R., Tan, Y., Zhang, H., 1999b. A framework forevaluating the effects of human factors on wildlife habitat: the case of giantpandas. Conserv. Biol. 13, 1360e1370.

Liu, J., Linderman, M., Ouyang, Z., An, L., Yang, J., Zhang, H., 2001. Ecologicaldegradation in protected areas: the case of Wolong Nature Reserve for GiantPandas. Science 292, 98e101.

Liu, J., Daily, G.C., Ehrlich, P.R., Luck, G.W., 2003a. Effects of household dynamics onresource consumption and biodiversity. Nature 421, 530e533.

Liu, J., Ouyang, Z., Pimm, S., Raven, P., Wang, X., Miao, H., Han, N., 2003b. ProtectingChina’s biodiversity. Science 300, 1240e1241.

Liu, J., Li, S., Ouyang, Z., Tam, C., Chen, X., 2008. Ecological and socioeconomic effects ofChina’s policies for ecosystemservices. Proc. Natl. Acad. Sci. U.S.A.105, 9477e9482.

Liu, W., Vogt, C.A., Luo, J., He, G., Frank, K.A., Liu, J., 2012. Drivers and socioeconomicimpacts of tourism participation in protected areas. PLoS ONE 7, e35420.

Liu, J., Ouyang, Z., Yang, W., Xu, W., Li, S., 2013. Evaluation of ecosystem servicepolicies from biophysical and social perspectives: the case of China. In:

W. Yang et al. / Journal of Environmental Management 127 (2013) 86e95 95

Levin, S.A. (Ed.), Encyclopedia of Biodiversity, second ed. Academic Press,Waltham, MA, pp. 372e384.

MA, 2005. Ecosystems & Human Well-being: Synthesis (Millennium EcosystemAssessment). Island Press, Washington, DC.

Olander, L.P., Gibbs, H.K., Steininger, M., Swenson, J.J., Murray, B.C., 2008. Referencescenarios for deforestation and forest degradation in support of REDD: a reviewof data and methods. Environ. Res. Lett. 3, 025011.

Ostrom, E., 1990. Governing the Commons: The Evolution of Institutions for Col-lective Action. Cambridge University Press, New York.

Ostrom, E., 2009. A general framework for analyzing sustainability of social-ecological systems. Science 325, 419e422.

Ostrom, E., Gardner, R., Walke, J., 1994. Rules, Games, and Common-pool Resources.University of Michigan Press, Ann Arbor.

Ostrom, E., Burger, J., Field, C.B., Norgaard, R.B., Policansky, D., 1999. Revisiting thecommons: local lessons, global challenges. Science 284, 278e282.

Ostrom, E., Janssen, M.A., Anderies, J.M., 2007. Going beyond panaceas. Proc. Natl.Acad. Sci. U.S.A. 104, 15176e15178.

Sanchez-Azofeifa, G.A., Pfaff, A., Robalino, J.A., Boomhower, J.P., 2007. Costa Rica’spayment for environmental services program: intention, implementation, andimpact. Conserv. Biol. 21, 1165e1173.

Schaller, G.B., Hu, J., Pan, W., Zhu, J., 1985. The Giant Pandas of Wolong. University ofChicago Press, Chicago.

Scherr, S.J., Bennett, M.T., Loughney, M., Canby, K., 2006. Developing FutureEcosystem Service Payments in China: Lessons Learned from InternationalExperience. Forest Trends and PROFOR, Washington, DC.

Scullion, J., Thomas, C.W., Vogt, K.A., Perez-Maqueo, O., Logsdon, M.G., 2011. Eval-uating the environmental impact of payments for ecosystem services in Coat-epec (Mexico) using remote sensing and on-site interviews. Environ. Conserv.38, 426e434.

State Forestry Administration of China, 2005. Report of Forest Resources in China.China Forestry Press, Beijing.

Task Force for Eco-Compensation Mechanisms and Polices in China, 2007. Eco-compensation Mechanisms and Polices in China. Science Press, Beijing.

Tuanmu, M.-N., 2012. Spatiotemporal Dynamics of Giant Panda Habitat: Impli-cations for Panda Conservation under a Changing Environment. PhD Disser-tation. Department of Fisheries and Wildlife. Michigan State University, EastLansing.

Uchida, E., Xu, J.T., Rozelle, S., 2005. Grain for green: cost-effectiveness andsustainability of China’s conservation set-aside program. Land Econ. 81,247e264.

Uchida, E., Rozelle, S., Xu, J.T., 2009. Conservation payments, liquidity constraints,and off-farm labor: impact of the Grain-for-Green Program on rural householdsin China. Am. J. Agric. Econ. 91, 70e86.

Viña, A., Bearer, S., Chen, X., He, G., Linderman, M., An, L., Zhang, H., Ouyang, Z.,Liu, J., 2007. Temporal changes in giant panda habitat connectivity acrossboundaries of Wolong Nature Reserve, China. Ecol. Appl. 17, 1019e1030.

Viña, A., Bearer, S., Zhang, H., Ouyang, Z., Liu, J., 2008. Evaluating MODIS data formapping wildlife habitat distribution. Remote Sens. Environ. 112, 2160e2169.

Viña, A., Chen, X., McConnell, W., Liu, W., Xu, W., Ouyang, Z., Zhang, H., Liu, J., 2011.Effects of natural disasters on conservation policies: the case of the 2008Wenchuan Earthquake, China. Ambio 40, 274e284.

Viña, A., Chen, X., Yang, W., Liu, W., Li, Y., Ouyang, Z., Liu, J., 2013. Improving theefficiency of conservation policies with the use of surrogates derived fromremotely sensed and ancillary data. Ecol. Indicat. 26, 103e111.

Wolong Nature Reserve, 2005. Development History of Wolong Nature Reserve [inChinese]. Sichuan Science and Technology Press, Chengdu.

Wunder, S., 2005. Payments for Environmental Services: Some Nuts and Bolts.CIFOR Occasional Paper No. 42. Center for International Forestry Research,Bogor, Indonesia.

Wunder, S., 2007. The efficiency of payments for environmental services in tropicalconservation. Conserv. Biol. 21, 48e58.

Wunder, S., Alban, M., 2008. Decentralized payments for environmental services:the cases of Pimampiro and PROFAFOR in Ecuador. Ecol. Econ. 65, 685e698.

Wunscher, T., Engel, S., Wunder, S., 2008. Spatial targeting of payments for envi-ronmental services: a tool for boosting conservation benefits. Ecol. Econ. 65,822e833.

Xu, J.T., Katsigris, E., White, T.A., 2002. Implementing the Natural Forest ProtectionProgram and the Sloping Lands Conversion Program. Western China Forests andGrassland Taskforce of China Council for International Cooperation on Envi-ronment and Development, Beijing.

Xu, J.T., Yin, R.S., Li, Z., Liu, C., 2004. Sloping land conversion: cost-effectiveness,structural adjustment, and economic sustainability. China Econ. Q. 4, 139e162(in Chinese).

Yang, W., Chang, J., Xu, B., Peng, C., Ge, Y., 2008. Ecosystem service value assess-ment for constructed wetlands: a case study in Hangzhou, China. Ecol. Econ.68, 116e125.

Yang, W., Dietz, T., Ouyang, Z., Liu, J. Interaction effects of conservation anddevelopment policies on rural household income and income structure, sub-mitted for publication.

Yang, W., Dietz, T., Liu, W., Luo, J., Liu, J., 2013a. Going beyond the MillenniumEcosystem Assessment: an index system of human dependence on ecosystemservices. PLoS ONE 8, e64581. http://dx.doi.org/10.1371/journal.pone.0064581.

Yang, W., Dietz, T., Kramer, D.B., Chen, X., Liu, J., 2013b. Going beyond the Millen-nium Ecosystem Assessment: an index system of human well-being. PLoS ONE8, e64582. http://dx.doi.org/10.1371/journal.pone.0064582.

Yang, W., Liu, W., Viña, A., Tuanmu, M., He, G., Dietz, T., Liu, J., 2013c. Nonlineareffects of group size on collective action and resource outcomes. Proc. Natl.Acad. Sci. U.S.A., http://dx.doi.org/10.1073/pnas.1301733110.

Yin, R.S., 2009. An Integrated Assessment of China’s Ecological Restoration Pro-grams. Springer, Dordrecht, The Netherlands.

Zhang, L., Wang, N., 2003. An initial study on habitat conservation of Asian elephant(Elephas maximus), with a focus on human elephant conflict in Simao, China.Biol. Conserv. 112, 453e459.

Zhang, H., Li, D., Wei, R., Tang, C., Tu, J., 1997. Advances in conservation and studieson reproductivity of giant pandas in Wolong. Sichuan J. Zool. 16, 31e33 (inChinese).